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Finland to raise taxes, cut spending to bring down deficit
March 25, 2014 / 10:47 PM / 4 years ago

Finland to raise taxes, cut spending to bring down deficit

HELSINKI (Reuters) - The Finnish government will raise taxes and cut spending to bring down the budget deficit, Prime Minister Jyrki Katainen said on Tuesday.

Finland's Prime Minister Jyrki Katainen speaks at the European People's Party (EPP) Elections Congress in Dublin March 7, 2014. REUTERS/Suzanne Plunkett

The budget framework agreement, where the government sets spending and taxation plans for the next three years, led to the small Left Alliance exiting the government as it rejected the austerity measures. The government still commands a parliamentary majority.

The measures announced aim at bringing the government deficit down to 1 percent of gross domestic product by 2018, the government said. It was 2 percent of GDP last year.

“These were not easy decisions, but they were necessary,” Prime Minister Jyrki Katainen told a news conference.

Reporting by Sakari Suoninen; Editing by Eric Walsh

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